Data reveals that the Bitcoin Coinbase Premium Index has remained in the negative territory during the recent surge to $68,000. This trend could have significant implications for the asset.
An analyst explained in a CryptoQuant Quicktake post that the BTC Coinbase Premium Index is currently showing negative values. The Coinbase Premium Index measures the disparity between Bitcoin prices listed on Coinbase (USD pair) and Binance (USDT pair). When this metric is positive, it indicates that the BTC price on Coinbase is higher than on Binance, suggesting greater buying pressure (or lower selling pressure) on Coinbase. Conversely, a negative index implies that Coinbase users are engaging in more selling activity than their Binance counterparts, resulting in a lower trading rate on Coinbase.
A recent chart displays the trend of the Bitcoin Coinbase Premium Index over the past few months. Historically, the index and Bitcoin’s price have demonstrated a notable correlation. When the metric assumed positive values, Bitcoin rallied; when it dipped into negative territory, the price fell. This pattern extended through much of 2024, indicating that Coinbase users might be driving market movements through their behavior.
Coinbase is the preferred platform for U.S.-based investors, particularly large institutional entities, while Binance serves a global investor base. Thus, the index reveals how American whales’ behavior contrasts with the rest of the world. However, despite the significance of these U.S.-based institutional investors, the pattern has recently diverged. The chart shows that during the latest Bitcoin rally, reaching $68,000, the index has remained negative.
Compounding the anomaly, the index typically turns positive when spot exchange-traded funds (ETFs) experience inflows. Despite considerable net inflows into spot ETFs recently, the metric has stayed red. This raises questions about whether Binance investors, including retailers, institutions, or whales, are surpassing the buying pressure observed on Coinbase Pro.
The future remains uncertain. It is yet to be determined whether the continued divergence between the index and Bitcoin’s price signifies a lasting shift in market dynamics away from Coinbase dominance, or if it is merely a temporary deviation. Meanwhile, Bitcoin’s price has maintained its bullish trajectory over the past day, reaching a remarkable $68,000.